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By Adewale Sanyaolu
The Shell Petroleum Development Company (SPDC) has renewed its calls for the payment of outstanding cash-calls, gas and power receivables.
Managing Director of SPDC and Country Chair, Shell Companies in Nigeria, Mr. Osagie Okunbor, stated this in his presentation at the 2022 Society of Petroleum Engineers(SPE) Oloibiri Lecture Series and Energy Forum (OLEF) with the theme ‘‘ Global Energy Transition: Implications on Future Investments in the Nigerian Oil and Gas Industry held in Abuja at the weekend.
Although, Osagie did not give figures for the outstanding cash-call and other debts, a Nigerian National Petroleum Company (NNPC) status report on the Pre-2016 Cash Call Arrears Repayment to the IOCs as at October 31, 2021, indicated that a total of $3.53billion has been paid by the Federal Government to five international oil companies as cash call arrears repayment, leaving an outstanding balance of $1.15billion.
The report, outlined the five IOCs to include SPDC, Mobil Producing Nigeria, Chevron Nigeria Limited, Total Exploration and Production Nigeria and Nigeria Agip Oil Company.
Figures from the document indicated that the Federal Government had completed the cash call repayments to MPN and CNL.
It was observed that the total negotiated debt and total payment to date of MPN was $833.75million, while the total negotiated debt and total payment to date of CNL was put at $1.097billion.
For SPDC, data from the latest repayment report showed that while the total negotiated debt was $1.37billion, the total payment to date was $680.6million leaving a balance of $691.91million.
On OLEF, he noted that mankind has gone through previous energy shifts and transitions starting from Biomass(wood) to coal followed by coal to oil and gas.
‘‘A transition is not an abrupt change from one ‘reality’ to another, but rather a shift that unfolds generationally over considerable time, and one that may lead to greater diversity in the energy marketplace.’’
On reasons for another energy transition, Osagie listed these to include; environmental cost of fossil fuels, greenhouse gases (C02) warming, the Paris agreement and commitment and the need for cleaner energy.
Others according to him are; security and access, environmental sustainability and economic development and growth.
He noted that energy use today is far more than electricity, saying it is impossible to predict with precision how future energy systems will evolve because there are too many unknowns, maintaining that the transition will move at different paces in different countries.
He disclosed that tackling climate change will require a combination of more renewable sources of energy and natural gas while expanding energy access.
He averred that oil and gas will remain in the energy mix for decades to come because the world needs to meet its energy needs as it tackles climate change.
The Shell boss noted that improving Nigeria’s oil and gas investment climate extends beyond the energy transition, saying Nigeria must overcome security challenges in the Niger Delta, tackle crude oil theft, illegal bunkering activities and pipeline vandalism.
Others are; reducing high cost of oil production through operational excellence, strengthening and stabilizing the industry’s regulatory and commercial framework to grow investments while current geo-political tail winds impacting commodity prices would help attract investments, especially in gas.
